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 jargons
100%
capital guarantee
This is where the policy locked-in value
exceed the total investment amount
(policy price + future premiums).
clear title
A legal position on the policy ensuring
that no one has any financial interest
in the policy.
contract notes
It's a legally binding agreement to buy
a policy from the market maker. It is to
be signed by the investor and subject to
the terms and conditions.
deed of absolute assignment
Legal document transferring ownership
from one person to another.
formula maturity date
Formula
Maturity Value is the calculated value
of a policy at the maturity date using
the current bonus rates declared by the
insurance
company.
locked-in value
This is the guaranteed amount of the
policy. It consists of the sum assured
plus the attaching bonuses. This
locked-in value cannot be reduced or
removed.
maturity date
The date when the policy ends and all
the benefits of the policy will be paid
to the rightful owner of the policy.
This includes the sum assured, attaching
bonus that the policy has accumulated
throughout the years from start date
plus the terminal bonus.
notice of absolute assignment
Legal document advising the insurance
company regarding the change of
ownership.
policy
price
The price that the investor will have to
pay to take over the policy. This does
not include the future premiums of the
policy.
pricing discount rate
Standard way of calculating the price of
a policy for sale. It is the rate at
which the Formula Maturity Value and
future premiums are discounted to reach
a price for a policy.
reversionary bonus or attaching
bonus
This is the Annual bonus allocated
to the policy by the insurance
company. Once the bonus is
allocated, it cannot be taken away
or reduced.
sum
assured
An amount guaranteed to be paid out when
the policy matures or on earlier (death)
claim, providing that premiums have been
paid in full.
surrender value
The amount the Life Office would give
you if you were to give up the policy.
We need an up to date surrender value
and this can be obtained from your Life
Office.
surrender
value date
Date that the Surrender Value was
given/sent to a policyholder.
terminal
bonus
The terminal bonus is a lump sum added
to the policy on maturity; it is not
declared until the policy matures.
total
investment amount
The total amount that the investor will
have to pay for the entire investment
period. This includes the policy price
and the future premiums to maturity.
total
premium to maturity
This is the total of all the premiums
that the investor will have to pay to
service the policy till maturity. The
investor can choose to pay the total
premium upfront at point of investment
or he/she can choose to service the
premiums yearly/monthly.
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